Classification and perception of pension systems around the World. “Delevoye reform”, CSG applied to retirees, revaluation of the minimum old age … the retirement system in France is often the subject of debate. Through the analysis of 2 studies, this article takes stock of the situation in France compared to the rest of the world. The first assesses the quality of the system, the other the way in which workers prepare for retirement around the world.
Mercer ranking, France in the middle of the table
Mercer unveiled in 2018 a new edition of the Mercer Melbourne Index (MMGPI) which measures pension systems around the world. He analyzed 34 plans based on more than 40 indicators to try to determine their performance, sustainability and integrity.
The study reveals a growing tension in pension systems around the world in reconciling 2 objectives: ensuring an adequate standard of living for retirees (performance criterion) and guaranteeing the financial sustainability of the system (viability criterion). The integrity criterion, for its part, assesses the quality of governance and the control of management costs.
With an overall score of 80.3 out of 100, the Netherlands took 1st place from Denmark in 2018. That year, as in 2017, France is in the middle of the ranking. She is 17th out of 34, with an overall score of 60.7 (for an average of 60.5). It scores very well on performance (79.5), lower on viability (42.2) and integrity (56.5).
But the reforms planned at the time (Pacte law, Agirc-Arrco merger, comprehensive pension reform), which the 2018 study did not take into account, should improve its rating on the criteria of viability and integrity.
Assets unevenly prepared for retirement
HSBC published in 2018 the 15th edition of its benchmarking study on pensions, titled Bridging the Gap (“Bridging the Gap”). This study reflects the opinions of more than 17,000 people in 16 countries.
Internationally, the perception of retirement is generally positive. Most of those questioned of working age hope to find greater freedom (72%), open up to new hobbies (75%) and regain physical shape (59%). The French are more enthusiastic about the first 2 items (75% and 76% respectively), but less about the idea of returning to sport (47%)!
53% of French people of working age associate retirement with tranquility. It is also synonymous with relaxation (38%) and happiness (33%). Only 12% associate retirement with a feeling of boredom.
Internationally, 58% of respondents intend to continue working after retirement. This trend is least represented in France (32%), against 60% in China or 48% in the United Kingdom. While globally, 42% of people of working age plan to embark on an entrepreneurial project in retirement, they are only 18% in France, compared to 36% in the United States and 54% in India.
If, globally, 26% of people of working age say they save regularly for their future life, 43% say they live financially from day to day: 28% in France, 54% in China, 44% in the United Kingdom).
Despite a significantly longer life expectancy than that of men, women are less well prepared for retirement. Globally, only 29% of women of working age say they contribute much more or a little more than their partner to the couple’s retirement savings. In France, they are only 13%.